MILAN — The sale of Benetton’s sporting goods business last year and a strong euro bit into first-half revenue, but a lower tax rate lifted net profit. The company also increased its full-year profit guidance and revised its sales target 1 percent lower to 2 percent.
Net profit for the six months ended June 30 rose 34 percent to 67 million euros, or $82.2 million, from 50 million euros, or $55.2 million. The disposal of the sporting goods division, which generated revenue in the first part of 2003 before it was sold, caused Benetton’s revenue for the period to drop 12 percent to 853 million euros, or $1.05 billion, from 969 million euros, or $1.07 billion. Dollar figures have been converted from euros at average exchange rates for the corresponding periods.
Benetton said that on a comparable basis, stripping out sales from the sports business and currency exchange effects, revenue would have fallen 2.2 percent.
Operating profit slid 14.6 percent to 111 million euros, or $136.2 million, from 130 million euros, or $143.6 million, but a lower tax rate helped Benetton on the net level.
The company paid 23 million euros in taxes, or $28.2 million, in the half compared with 44 million euros, or $48.6 million, the year before.
Benetton revised its full-year guidance figures, saying it expects full-year net profit of 125 million euros to 130 million euros, or $152 million to $158 million.
In releasing first-quarter numbers in March, the company had said net profit would be closer to 126 million euros, or $153 million.
The company said it anticipates full-year sales of 1.75 billion euros, or $2.13 billion, rather than the 1.8 billion euros, or $2.19 billion, it forecast at the first-quarter mark. Benetton also said that sales of casualwear, which account for about 90 percent of total revenue, should lose 1 to 2 percent this year. In March, Benetton said its casualwear business would show “moderate” growth to 1.58 billion euros, or $1.92 billion.
— Amanda Kaiser